Rakuten buys bruised bitcoin biz Bitnet, plans Belfast blockchain lab

Japanese e-commerce giant is increasingly eyeballing Bitcoin as a payment option.

Japanese e-commerce site Rakuten has confirmed the acquisition of Northern Irish bitcoin startup Bitnet and said it plans to establish a blockchain research lab in Belfast.

The so-called Rakuten Blockchain Lab is billed as "a dedicated research and development organisation" focusing on how to apply blockchain tech in fintech and e-commerce. Job cuts appear to loom at Bitnet, however, with Rakuten promising to employ some of the outfit's key staff with only CTO Stephen McNamara and engineering veep Fergal Downey getting a name check in the official announcement. According to Bitnet's website, the startup currently has a staff headcount of seven.

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Bitnet is a blockchain-powered digital payment system set up as a rival to the larger bitcoin payment platforms like Coinbase and Bitpay. Rakuten invested £11 million in Bitnet two years ago, while it started integrating the smaller firm's payment platform into its own services last summer.

However, Bitnet has been struggling recently, and has had to lay off around half of its staff as it failed to make inroads into the market. Rakuten's technology boss Yasufumi Hirai trumpeted the buyout:

Drawing on the significant IP assets and deep engineering expertise of the Bitnet team and combining that with Rakuten’s leadership in fintech and support of innovative solutions, the new Rakuten Blockchain Lab will be our first step toward unlocking blockchain’s potential to revolutionise the way that financial and e-commerce transactions are conducted.

Downey added: "There are so many great opportunities for blockchain technologies inside Rakuten and the newly created lab will be instrumental in delivering new and innovative solutions."